Having the border with Mexico closed is changing the landscape of US cattle feeding, if only for a little while.
Cattle imports from Mexico were shut off last year to control the spread of New World Screwworm into the US herd where it has been absent since the 1960s. The lack of feeder cattle to fill US feedlots has been most evident in Texas.
CATTLE ON FEED REPORT SHOWS THE CHANGES
The Mexico border has been closed this last time since November, and the timeline given by the USDA indicates it may be a while before it reopens. The New World Screwworm was eradicated in the US by releasing hoards of sterile male blowflies into the wild to mate with females.
But since the 1960s there hasn’t been any need for facilities to produce sterile male blowflies, so now, work has to be redone to bring some back into production, and the USDA has said the border will be closed until this is done.
Friday’s USDA Cattle on Feed report showed the effects of the lack of feeder cattle and the regional disparity of feedlot placements.
More than one market analyst pointed out the differences in the hours after the Cattle on Feed report was released Friday afternoon. Nevil Speer, an industry consultant based in Bowling Green, KY, pointed out in an email that on-feed numbers were up from last year in Kansas by 30,000 head with Iowa/Nebraska/South Dakota numbers up by 100,000. This was against Texas where they were down by 210,000 head with a total difference of 80,000.
Also, total US feedlot placements were down 160,000 head with Texas placements down 85,000, which was 53% of the total decline, Speer said.
And another thing – average placement weights were up seven pounds from a year ago, a “huge” difference since average placement weights usually don’t vary much from year to year on a monthly basis, Speer said.
A second analyst pointed out that Texas feedlot placements fell to the lowest volume of 420,000 head since 1998.
NWS VERY BAD
NWS is a parasitic fly that infests wounds on all animals, including humans. Unlike other flies that feed on and lay eggs in dead, rotting flesh or manure, the NWS only attacks living flesh. Most recently, it has spread from Panama through Central America and into Mexico.
The sterile male approach to eradication is successful because females will only mate once, and if that happens with a sterile male, her eggs also will be sterile.
CATTLE, BEEF RECAP
The USDA reported formula and contract base prices for live FOB steers and heifers last week ranged from $225.15 per cwt to $243.37, compared with the previous week’s range of $223.72 to $234.90 per cwt. FOB dressed steers, and heifers went for $353.24 per cwt to $378.85, compared with $349.46 to $370.67.
The USDA choice cutout Friday was down $3.29 per cwt at $390.50 while select was up $2.36 at $376.95. The choice/select spread narrowed to $13.55 from $19.20 with 76 loads of fabricated product and 17 loads of trimmings and grinds sold into the spot market.
The USDA-listed the weighted average wholesale price for fresh 90% lean beef was $398.53 per cwt, and 50% beef was $202.28.
The USDA said basis bids for corn from feeders in the Southern Plains were up $0.03 to $0.05 at $1.25 to $1.35 a bushel over the Jul corn contract, which settled at $4.28 3/4, down $0.04 3/4.
No live cattle delivery notices were posted.
The CME Feeder Cattle Index for the seven days ended Thursday was $310.99 per cwt, down $1.63. This compares with Friday’s Aug contract settlement of $302.45, down $1.72.